Poland is extricating itself from medium-development trap - PM

Addressing the 10th congress of Polish economists in Warsaw on Thursday, Prime Minister Mateusz Morawiecki said he believed that "Poland has been slowly extricating itself from a medium development trap."

Morawiecki stressed that his belief was based on the available data, and said that Poland was on a good path to extricate itself from the trap but underlined that this would be a long process.

The official added that the quality of state institutions was of considerable importance for the process and emphasised that "we should speak ever more strongly about symbiosis between the state and the market."

"The countries that achieved the greatest success have managed to find this level of symbiosis. A common denominator between the market and the state, and the effectiveness of a state institution," Morawiecki said, adding he was talking about such states as South Korea, Japan, Taiwan, Singapore, China and European ones like Scandinavian countries and Spain.

The prime minister also stressed the key role of fiscal policy in the current economy, and praised his government for its operations regarding the budget deficit, public debt and tax collection.

Underlining the role of symbiosis between the state and the economy, the prime minister said Germany was a good example since "for decades after WWII, it effectively supported its markets and its businessmen."

"That is why we talk about Deutschland AG, namely, about one large German economy. Siemens supports Krupp, Krupp takes credits from Deutsche Bank, everybody flies Lufthansa. And everything is being supervised by the German state. This model has proved perfect," Morawiecki said.

But at the same time, the prime minister stressed that growing levels of indebtedness, both private and public, could lead to a model of a debt state, and again pointed to the key role of fiscal policy.

"A rapidly changing world creates new challenges for fiscal and monetary policy," he said, referring to Nassim Nicholas Taleb's book titled 'The Black Swan: The Impact of the Highly Improbable.'

"On the one hand, institutions are independent of each other, and on the other, there is co-responsibility for economic growth," PM Morawiecki said, turning to representatives of Poland's Monetary Council (RPP) present at the congress. "And this responsibility lies with trade unions, employers and with the fiscal and monetary policy," he added.

Referring to Poland's economic growth, the prime minister said it has been and continues to be high, especially in considering the country's environment, but it "lacked something."

"Economic growth should ensure fair development and today we are facing such challenges as social inequalities, taxation of large companies, global digital companies and tax havens," PM Morawiecki concluded.